A question about Judgements

[cravenmobile]

I had a question regrading Judgments and hopefully you guys have seen something like this. I had medical debt that I didn't know existed go to collections, I tried to work with the agency but they weren't having it. Is there a usual amount of time given to settle these things before they take further action? My worries right now are that they would either try to repossess one of my cars or garnish wages.

[lorraineb]

Although I am not an expert in this at all, this information may be of help: http://www.consumer.ftc.gov/articles...ebt-collection

[bjl584]

A collection agency can't repo your car. Only the entity that holds the loan for your car has the authority to repo your car should you stop making the payments on it.

As far as garnishing wages, that varies by state. Some states don't allow it. You will have to see if it is possible where you live.

[cravenmobile]

An Update.

I received a sizable bonus from an extra job that I was working on so I called the collection agency that held the judgement. They told me that it would be 2700 dollars because they had been adding 100 dollars every month! Realizing this was outrageous I offered them 2k just to be done with it. Then we settled at 2300. I am so glad this is off my shoulders and now its on to the next thing.

Now my car is paid off and the only debt that we have left is my wife's car, about 5.2k, and a medical debt of 1k that we have been making 100 dollar payments on. Once this is all in the clear, we can start saving for our home.

Also one last question, my wife wants to continue making the 400 dollar a month payments on her car, stating that the money loss isn't hurting us and it is helping our credit. is this true? or would it be better to just finish it off. In a month i will have enough to pay it off entirely.

[disneysteve]

Then we settled at 2300. I am so glad this is off my shoulders and now its on to the next thing.

Don't send them a penny until you have that settlement agreement IN WRITING. Once you do, pay them with a money order or cashier's check. Absolutely do not give them electronic access to your bank account.

my wife wants to continue making the 400 dollar a month payments on her car, stating that the money loss isn't hurting us and it is helping our credit. is this true?

No. Your wife is incorrect. If you can afford to repay the loan, repay it. Don't keep debt just to build your credit score. It isn't worth paying interest in order to bump up your FICO. Pay all of your bills on time. Don't carry credit card balances. And don't borrow money you don't need to borrow and your credit score will be just fine.

[lorraineb]

Also realize that you may owe taxes next year on the difference between what was owed and what you actually paid unless the terms of the settlement state that you paid in full.

[Byron T.]

Brave New World

Any time you have the opportunity to be debt free, be debt free. In the not-too-distant future, your credit score isn't going to matter a tinker's damn. What's going to matter is the amount of cash you have on hand (not in the bank) and your ability to earn money on a consistent basis.

Look at the way many people live in other countries: they work hard, spend wisely, save what they can and enjoy life. Most of the people on this planet don't have a credit score. If you're not planning on taking on debt, you don't need it.